Most tokens are used with decentralised applications (dApps). When developers create their tokens, they can be used to activate features of the application they were designed for.
Some tokens are created to represent a physical thing. If you want to sell your house using a smart contract, you can't physically put your house into the smart contract, but you can use a token that represents your house.
For example, WePower (WPR) uses a token that represents electricity. Users can buy and sell electricity on the blockchain using smart contracts.
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People who are new to cryptocurrency often confuse the term "token" and "coin". This guide defines the two terms and provides some examples for a better understanding.
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